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Is SM Prime Holdings, Inc. (SMPH) In Trouble?

sm prime holdings inc., SMPH philippine stocks, henry sy, ron acoba, rising wedge, daily stock picks, stock market trading, fibonacci retracement

Are the bears about to take control of the shares of SM Prime Holdings, Inc. (SMPH)? I am confronted with this question now because it appears that SMPH is indeed primed (no pun intended) for a major correction in the near term.

In my opinion, there is a good chance that the bears might take over SMPH’s driver seat. As you can see from the chart above, SMPH has rallied quite handsomely after hitting a low of just about PHP 10.00 from a high of PHP 13.16. After bouncing off the said low, SMPH has sprung back to life as it reached the PHP 12.00 level. The PHP 12.00 resistance, though, seems to be holding pretty well. On a closer look, the PHP 12.00 marker happens to perfectly fall in line with the 61.8% fibonacci retracement level using the aforementioned high and low points as swing high and low. Moreover, the recent run-up in prices turns out to form a rising wedge pattern. As some of you might know, a rising wedge is considered as a bearish formation for technical analysts since it merely represents a temporary rally in prices.

If such is the case and a breakdown from the rising wedge occurs then SMPH could immediately fall towards PHP 11.00. A breach of that level could further send it down to PHP 10.00. On the positive note, a move past PHP 12.00 could send it towards the PHP 13.00 area.

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